Can a background check company be sued for giving false/misleading information to a potential employer?

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Can a background check company be sued for giving false/misleading information to a potential employer?

I was offered a job with a state agency and I accepted. One of the conditions of employment was a background check. I signed forms for this background check. A few weeks later I received a notice from the state agency stating that they had chosennot to hire me because of information received from this background agency. I disputed the matter and the background company verified the accuracy of my information. This company sent me a letter a few weeks later informing me that they had corrected the false information and notified the employer, but by this time the employer had offered the job to someone else.

Asked on August 9, 2011 Louisiana

Answers:

S.L,. Member, California Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

You may be able to sue the background investigation company for negligence.  Negligence is failure to exercise due care (that degree of care that in this case a reasonable background investigation company) would have exercised under the same or similar circumstances to prevent foreseeable harm.

In order to prove negligence, you will need to prove duty (duty of due care mentioned above), breach of duty (failure to exercise due care in the background investigation), actual cause, proximate cause, damages.  Actual cause means but for the inaccurate information from the background investigation company, would you have lost the job opportunity?  If the answer is no, which appears to be the case, you have established actual cause.  Proximate cause means were there any unforeseeable intervening events which would relieve the background investigation company of liability?  If the answer is no, you have established proximate cause.  Damages means the amount you are seeking to recover in your lawsuit.  Damages would be lost wages.  You will need to mitigate (minimize) damages by trying to find another job with comparable pay.  If you find another job that pays less than the job for which you would have been hired had it not been for the erroneous background information, your damages would be the difference in income between the two jobs.

You will need to file your lawsuit for negligence against the background investigation company prior to the expiration of the applicable statute of limitations or you will lose your rights forever in the matter.


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